Who would have thought that the Internet of Things (IoT) could bring demonstrable value to the auto dealership business? Yet that's exactly what's happening at some dealerships among the higher end market brands like Audi, Mercedes-Benz, BMW and Lexus. MyDealerLot is using a combination of RFID and information delivered via MongoDB to deliver an array of value add services that benefit both the customer and dealership.
Check out some of the examples: car wash concierge, instant car appraisals and automated customer recognition (see video at end.)
I spoke with David Strickland, CTO, MyDealerLot to get the skinny on what's happening. My initial question was around RFID. This is a technology that has held promise for many years and yet it's been hard to find examples that stick or which deliver the kind of value that makes the investment worthwhile. Strickland agreed, saying that the trick has been in finding the right combination of physical assets and software that deliver attractive price point solutions.
Automotive has changed. The money is no longer made on the front end but in the post sale service. We allow dealers to do better and help them maintain their Customer Satisfaction Index (CSI) scores by improving service while eliminating dead time.
CSI scores are now regarded as so important that some dealerships tie salesperson compensation to this measure. That's a great incentive to deliver the best experience. In turn that's meant MyDealerLot has grown 438% in three years. It now counts 140 dealerships live on the system and expects to reach 150 by December 2014:
In 2013, Audi did a 10 store test of our system. The key four CSI scores improved significantly. The improvement was so large that Audi extended the test to another 25 stores and the trend has continued.
What was the problem?
We are a very lean organization, I have one IT guy. We need a way to reduce risk by geo-distributing the database. It's cost prohibitive to do ourselves yet our database is growing at fast pace. If you said we are taking on customers at 2x then the database feed is growing at 3x. Right now we're shifting 1GB of data a day and feeding out to 2,000 screens across the dealerships. That was crushing our SQL machines and we simply couldn't write the data fast enough.
OK - I think we get that, so where does MongoDB fit in?
Because of the way MongoDB works, we have the ability to spin up additional resources without requiring local cost addition. Silverlight displays in those 2,000 desktops providing sub-second information to the dealership. The transaction speed is so much faster, latency is almost zero. As a customer drives into the reception lane, the RFID tag is read, processed and a welcome message posted to screen. The dealership knows everything it needs to provide the customer with the service they want. So now, we've gone from 80% utlilization to 15% on SQL. Utilization on Mongo boxes translates down to 6% with a fraction of the memory we were using.
So when we get a request then we have a whiteboard session pretty much like everyone else does. But adding a change, say a new field is now trivial. A couple lines of code and boom it's added to data model. We can be operational in minutes. It's absolutely crazy the amount of efficiencies we gain via JSON. We're not looking at XML with 200 tables in SQL Server and 2,000 plus methods to fetch data. In MongoDB we only have 20-30 accessor methods. We are able to reduce the mapping layer 80%. and that's drives efficiency.
So that's the technical discussion out the way and at this point Strickland waxed lyrical about his experience:
I’ve never had so much fun as I have writing with these technologies. It's not all plain sailing but then we've had great customer support from MongoDB. They're very much like us, still in a sort of startup mode.
Does it get better than that? I don't know but I do know it is very rare for me to hear a genuinely excited CTO and that can only be because of the confluence of several factors. MyDealerLot's technology choices have put it in a very strong position. It is the preferred supplier for Audi and expects to achieve that status with other brands. He can service his customers in the equivalent of real-time. He has the ability to run an extraordinarily efficient IT operation. They don't spend a penny on marketing - it is all word of mouth. Most of all, it's fun and you don't often get to hear that about IT.
Bonus points - Audi Coral Springs customer identification system in use.